In advance of opening two Haphazard hubs, this post documents the struggling retail sector in the English seaside resort of Great Yarmouth, which is experiencing rapid decline, like many provincial towns in the UK.
The Norfolk coastal town of Great Yarmouth appears to visitors, as well as many locals, to be in a desperate situation. Since my first blog post on the town during June 2019, even more shops have closed.
The department store Debenhams, the anchor for Great Yarmouth’s Market Gates Shopping Centre has left a gapping 2,620sq ft or 245sqm hole when it closed a few weeks back. Palmers, the only other department store in town is on the verge of liquidation – see film below. With shops offering ‘70% off’, ‘everything must go!’ and ‘£3 Crazy Prices’, it’s difficult to see how this downward spiral can be halted.
£3 Crazy Prices In One High Street Store, 04 Feb 2020
Besides Debenhams, there are numerous smaller empty retail units and pubs. Many of the existing shopkeepers are reliant on an ageing population who still shop traditionally, through browsing and paying at the till in-store. However, this also appears in decline, having observed shopper behaviour over winter 2019/20.
l. 10.30am Saturday morning 01 Feb 2020 | r. Sudden Disappearance, shop became empty overnight, £90pw
Uncaring Landlords
Beside online shopping, there is a raft of reasons for the steep decline in retail, including apathy and greed of landlords. Although by no means universal, local conversations have revealed there are landlords who, having bought very cheap, seek to extract maximum return from retailers while offering little or no support, improvement to property, marketing or even general upkeep. As was observed in Margate in 2011, many of the landlords do not live in the town, even if they grew up in Great Yarmouth, and see the investment as purely transactional, with no greater concern for the building, tenant or wider community. Although there have been some positive stories from occupiers, it is increasingly clear that shops in Great Yarmouth are used as vehicles to accumulate cash and buy more property for quick return.
50sec example of beachfront and main thoroughfare at 4.30pm on a Saturday afternoon.
Changing Tide
For decades, landlords of retail premises have been in the driving seat, even in times of recession, with the asset normally acting as security against short-term cashflow difficulties. This time the decline is fundamentally different, and retail assets could potentially become fatal liabilities, as Intu woes demonstrate.
The pressure on the high street is unabated. Rents are falling, insolvencies are rising, values continue to slide. Even Intu’s most prized shopping centres are struggling to hold their values. Last month the LTV of Intu’s MetroCentre in Gateshead rose above 70 per cent, triggering punitive clauses in lenders’ covenants. The company has been selling assets in Spain and elsewhere but at a good tenth below book value.
The FT, Cat Rutter Rutter Pooley, 11 February 2020
Consumer habits have completely changed in the past decade. More nimble proprietors have adapted by embracing flexible terms and some business start-ups are employing more savvy business models. Yet away from the odd pocket of property innovation large swathes of stakeholders are being too slow, or too arrogant to transform, and in keeping with Darwinism business concepts will soon die.
AI Supermarkets
The greatest cause of the present decline comes from internet shopping, and this is before the arrival of more advanced technologies. AI Supermarkets, new forms of delivery systems including drone and the rise of reusing and re-appropriating obsolete technology, equipment and clothing are all likely to inflict further damage on traditional trading models.
Ability to adapt applies to retailers in all sectors. It is no longer possible, exceptional circumstance notwithstanding, for businesses to sit on stock for years, or decades in some cases, and serve customers as if it is 1970. Those times have gone, and those who refuse to recognise it will also soon be gone.
And in the holes that are left, new, younger, agile and forward-thinking operations have an opportunity to establish; see The Green Grocer (blog post to follow).
Where Does The Fourth Industrial Revolution (4IR) Come In?
The present transformation of Britain’s high streets have been largely driven by the launch of the World Wide Web (www.) in the early 1990s. The next wave of innovations will likely be even more transformative. Although the focus of the 4IR is often on the robots and algorithms, the most noticeable, although maybe fairly imperceptible change will come through an evolution of daily routines, everyday processes and living systems.
The two Haphazard hubs opening in Great Yarmouth will look to reflect on this change taking place, through creating retailesque spaces, that straddles shopping, leisure, exhibitions, education and social.
Documenting Great Yarmouth
The following 10minute video documents the conditions being observed. Recorded in Great Yarmouth on a Saturday afternoon during winter 2020, the film is not intended to act as a comment on the town. As the year progresses, I will revisit the high street with new films so comparisons can be made.
Film of Market Gates, Great Yarmouth market place and hub sites, recorded 5pm Saturday 01 February 2020
The Market Gates Shopping Centre is owned by Ellandi, and a short history of the centre is available on Wikipedia.
Hub One: click here to read more about StonecutterSpace
Hub Two: click here to read more about St John’s Head
John M
References
Cat Rutter Pooley, Why Link is just not into Intu, The FT, 11 Feb 2020, Online. https://www.ft.com/content/ef56e3b6-4ccd-11ea-95a0-43d18ec715f5
Haphazard Business 